HCMC proposes a 1.1–1.3x compensation ratio for rebuilding old apartment blocks, with 50% infrastructure cost support

The HCMC Department of Construction is collecting comments on a draft resolution on renovating and rebuilding apartment buildings, proposing fixed compensation coefficients instead of letting investors and residents negotiate as now. According to the HCMC Real Estate Association (HoREA), the city has 474 old apartment complexes that need renovation or rebuilding.

Proposed compensation coefficients

• Apartments on floor 2 and above: coefficient of 1.1.
• Ground-floor apartments: coefficient of 1.3.
• These coefficients apply when the commune-level People’s Committee appoints the investor for the project.
• Current rule: the provincial People’s Committee issues a coefficient range, and investors and residents agree on the specific figure.

Conditions for communes to appoint an investor

• The apartment owners’ meeting has been held twice without 50% of owners’ representatives attending.
• Written consultation options have all failed.

Resettlement and social housing

• Households not eligible for resettlement may buy social housing without a lottery.
• These households do not need to meet income or housing conditions. Current rules require meeting the average actual income condition.

Relocation, planning and budget

• Communes may enforce relocation once more than 75% of residents have moved under the compensation plan.
• Communes may decide planning, architecture and population criteria without conforming to the 1/2000 zoning plan. Current law requires 1/500 detailed plans to conform to 1/2000 plans.
• Apartment buildings built before 1994 with mixed ownership: the city allocates budget funds to repair common areas instead of owners contributing.
• The budget directly covers 50% of technical infrastructure costs and 50% of enforced relocation costs.

Status of old apartment buildings in HCMC

• 474 old apartment complexes across the city need renovation or rebuilding, according to HoREA.
• Of the 16 grade-D buildings (the most dangerous level), the city has relocated 534 households from 9 buildings; some sites are unfinished or not yet started.